Share subscription deed Template for Malaysia

A Share subscription deed is a binding legal agreement between a company and an investor who wants to buy new shares. It spells out the exact terms of the share purchase, including the price per share, total investment amount, and when payment needs to be made. In Malaysia, these deeds often include specific conditions that must be met before the shares are issued.

The deed protects both parties by clearly documenting the investor's rights, any warranties from the company, and key completion requirements under Malaysian company law. It's particularly important for private companies and startups raising capital, as it creates enforceable obligations and helps ensure compliance with the Companies Act 2016's share issuance rules.

Use a Share subscription deed when your company is bringing in new investors through a fresh share issuance. This document becomes essential during startup funding rounds, private placements, or when Malaysian companies need to document complex share arrangements with multiple conditions for completion.

It's particularly valuable when dealing with sophisticated investors who require specific rights or warranties, or when the investment involves staged payments. Malaysian companies often need this deed to satisfy due diligence requirements from banks and regulators, especially when the transaction involves foreign investors under the Companies Act 2016. Having this deed in place helps prevent future disputes about share ownership terms.

• Basic Single-Investor Deed: Straightforward agreement for one investor acquiring newly issued shares, with standard payment and completion terms
• Multiple Investor Deed: Structured for coordinated investment by several parties, often used in larger funding rounds with identical terms for all subscribers
• Conditional Subscription Deed: Contains specific performance requirements or milestones before share issuance, common in startup funding
• Staged Investment Deed: Designed for phased share subscriptions with multiple completion dates and progressive investment tranches
• Rights-Heavy Deed: Includes detailed investor protections, board representation rights, and veto powers, typically used for significant minority investments

• Company Directors: Responsible for approving and executing the Share subscription deed on behalf of the issuing company, ensuring compliance with Malaysian company law
• Investors: Individual or institutional subscribers who commit to purchasing new shares under the deed's terms
• Corporate Lawyers: Draft and review the deed, ensuring it meets legal requirements and protects their client's interests
• Company Secretary: Handles documentation, filing requirements, and updates to the company's share register
• Financial Advisors: Help structure the investment terms and validate financial aspects of the share subscription

• Company Details: Gather current share capital structure, company constitution, and board resolutions approving the share issuance
• Investment Terms: Document the agreed share price, number of shares, payment schedule, and completion timeline
• Investor Information: Collect subscriber details, proof of funds, and any special rights or conditions requested
• Warranties: List company representations about financial status, assets, and legal compliance
• Conditions Precedent: Define any requirements that must be met before shares can be issued
• Regulatory Checks: Verify compliance with Malaysian foreign investment rules and Companies Act requirements

• Parties: Full legal names and details of the company and all subscribers
• Share Details: Precise description of shares, class, rights, and total subscription amount
• Payment Terms: Clear payment schedule, method, and completion requirements
• Warranties: Company's representations about its legal status and share capital
• Conditions Precedent: Prerequisites for share issuance under Malaysian law
• Completion Mechanics: Step-by-step process for executing the subscription
• Governing Law: Explicit statement of Malaysian law jurisdiction
• Execution Block: Proper signature sections for all parties and witnesses

A Share subscription deed differs significantly from a Share Purchase Agreement. While both involve share transfers, they serve distinct purposes in Malaysian corporate transactions.

• Transaction Type: A Share subscription deed involves the creation and issuance of new shares directly from the company, while a Share Purchase Agreement transfers existing shares between shareholders
• Company Involvement: In subscriptions, the company is an active party issuing fresh shares and receiving payment directly. For purchase agreements, the company typically only acts as a record-keeper
• Capital Structure: Subscription deeds increase the company's share capital and alter its capital structure. Purchase agreements merely change ownership of existing shares
• Regulatory Requirements: Subscriptions need board approval and compliance with capital raising rules under the Companies Act 2016. Purchase agreements focus more on transfer procedures and stamp duty obligations